Meta’s new social media platform, Threads, is posing a potential threat to Twitter as it gains popularity among users., Reuters news report said.
Launched on July 5, Threads reached 100 million users in record time, indicating its potential to challenge Twitter’s dominant position in the microblogging space. This development comes amidst Elon Musk’s announcement of Twitter’s rebranding and logo change to an X.
Though Threads experienced a slight drop in downloads and engagement following its launch, analysts foresee significant ad revenue opportunities if the app manages to retain its user base. Some estimates suggest Threads could achieve annual ad revenue of up to $5 billion, comparable to Twitter’s earnings in 2021.
Morningstar analysts predict that Threads could contribute between $2 billion and $3 billion to Meta’s annual revenue between 2024 and 2027, while Evercore ISI analysts estimate it could generate $8 billion in annual revenue by 2025.
Brands are already contemplating incorporating Threads into their marketing strategies, assuming the platform will introduce advertising in the future.
Content marketing firm Blue Hour Studios has clients considering sponsored deals with influencers that include Threads posts alongside TikTok or Instagram content. Advertising agencies and executives expect brands to shift their ad spending from Twitter to Threads once advertising options become available.
Some of her clients are considering adding a Threads post along with TikTok or Instagram posts as part of sponsored deals with influencers, Taylor Michelle Gerard, a senior executive at Blue Hour Studios, said.
Once Threads ads are available, brands will move their ad spending over from Twitter “without question, said Matt Yanofsky, co-founder of Moment Lab, a brand marketing and advertising agency. Some of his clients, who he did not name, are already examining whether to add a budget for Threads ads later this year.
Some advertisers have already moved away from Twitter due to concerns about the tone of discourse and abrupt changes in policies since Musk bought the firm last year, said Andrew La Fond, a vice president at ad agency R/GA, which has worked with Nike.
Many brands are experimenting on Threads, which has made social media feel fun again, said Liz Bartges, director of brand engagement at communications agency FerebeeLane. “We’re reliving the glory days of Twitter,” she said about Threads.
Twitter has faced challenges in recent times, with some advertisers expressing concerns about its tone of discourse and abrupt policy changes since Elon Musk’s acquisition of the platform. Consequently, some brands have already moved their ad spending away from Twitter. Meta, leveraging its experience running Instagram and Facebook, hopes that Threads will flourish, attracting even more advertisers.
While Threads has shown promising growth, it still has a long way to go to match Twitter’s reach of nearly 240 million monetizable daily active users. Meta’s CEO, Mark Zuckerberg, has indicated that the company will consider monetizing Threads once it reaches 1 billion users. In the meantime, Meta continues to invest in AI technology to improve its platforms’ traffic and ad sales.
Despite its current limitations, such as the absence of direct messaging, hashtags, and keyword searches, brands are excitedly experimenting on Threads, as it offers a fresh and engaging social media experience.